It’s been a big week for economic news.  But the headline is: interest rates are NOT going up any time soon.

This is important to two groups of Really Simple Money readers:  those who have recently bought property (they don’t need to panic if they can meet their current mortgage repayments);  and investors (they do need to panic if they have their cash in a bank savings account).

The Reserve Bank quarterly statement maintains that inflation will stay below 2-3 per cent next year…AND is unlikely to exceed the bottom of the range in 2019.

So no reason to raise interest rates to slow inflation.  There isn’t any.

BUT the downside is that wage growth is low. The ABS says hourly wage growth rose just 0.48% in the September quarter, missing forecasts for a larger increase of 0.7%.

Annual wage growth also came up short, rising by 2.01%, below the 2.2% level expected.

There is some good news.  Annual wage growth accelerated from 1.94% in the June quarter, suggesting that wage pressures are now starting to pick up following months of strong employment growth.

That’s very concerning, suggesting that without this temporary factor, quarterly growth would have been somewhere in the region of 0.3%, potentially the lowest level on record.

Some of us are richer than ever!

Australian households’ have increased their net wealth over the last four years from $5.7 trillion to $8.1 trillion, an increase of 42.1%!

This is one of the main findings from Roy Morgan’s newly released report ‘Superannuation and Wealth Management in Australia’ (October 2017).

The total increase in household net worth in Australia since 2013 was $2.432 trillion (from $5.703 trillion to $8.135 trillion), of which $1.387 trillion (or 57%) was a result of the increase in the equity of owner occupied homes.

Although people living in owner occupied homes account for 65.2% of the population, they hold 85.0% of the total funds in superannuation, 89.7% of all direct investments and 86.9% of bank deposits.

These assets combined with the equity in their homes, results in them holding 94.4% of total household’s net worth.

This leaves those who are non-home owners (34.8% of the population) with only 5.6% of the total.

And Millennial are star savers (Who knew?)

Those avocado eating millennials are charging ahead when it comes to saving – especially in super.

Their balances doubled between 2007 and 2017 – from 6.4% to 14.6%, according to Roy Morgan research.

In real terms that’s $226 billion of a 382 per cent increase – three times the general trend.

Gen X where up 8.7 per cent and Gen z up 1.9 per cent.

Na na na na na!

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